SEOUL (Reuters) - South Korea and the United States have finalized the text of a free trade deal, the trade ministry in Seoul said, clearing another hurdle for the ratification of the controversial agreement.
The trade ministry said in a statement the two countries plan to officially sign the document in the middle of next month, before sending it to their respective legislatures for final approval to end years of negotiations.
U.S. President Barack Obama on Tuesday called on Congress to pass the deal “as soon as possible,” as Washington strives to enact the agreement before a rival trade pact between Seoul and the European Union comes into force on July 1.
Obama’s specific call for Congress to pass the South Korean agreement followed a recent renegotiation to address concerns raised by the U.S. auto industry.
It had complained the original version failed to tear down barriers to South Korea’s auto market, while phasing out remaining U.S. tariffs on South Korean cars.
Under the revised terms, South Korea and the United States have also agreed to delay the elimination of tariffs on American pork for two years.
The U.S. International Trade Commission estimated in 2007 that the Korean agreement would boost U.S. exports by about $10 billion to $11 billion annually, while increasing imports from that country by about $6.5 billion to $7.0 billion.
Late last year, the Obama administration renegotiated the auto provisions of the agreement to win the support of the United Auto Workers labor union and Ford Motor Co, which previously had opposed the pact.
Those changes mean winning approval of the pact will no longer be as “horribly difficult” as it once was, but it will still face stiff opposition in Congress, U.S. Trade Representative Ron Kirk said earlier this month.
The U.S. will eliminate its 2.5 percent tariff on Korean cars within four years, instead of immediately or after three years as was previously agreed, after the deal takes effect.
South Korea will cut its 8 percent tariff on U.S. car imports to 4 percent, instead of eliminating it immediately and soften regulations on automotive safety and environmental standards.
A range of U.S. companies and industry groups have spoken out in support of the South Korea deal, including the United Auto Workers union and Ford Motor Co., which welcomed changes made to address their concerns about market access provisions of the original deal.
The pact with South Korea is the biggest of three trade agreements negotiated by the administration of former President George W. Bush but which have stalled in Congress because of strong opposition from Democrats.
A wide swath of U.S. farm, manufacturing and service industry groups support the agreement. But the AFL-CIO, the country’s main labor organization, remains opposed to it.
Additional reporting by Danbee Moon in Seoul and Doug Palmer in Washington; Editing by Andrew Marshall